News from AAP

Banks lead Aust market higher

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The Australian share market is trading higher on the back of expectations of another cut to interest rates, but has eased back on its run towards the 6,000 point mark.

The benchmark ASX 200 index has not been at 6,000 points since January 2008, during the global financial crisis.

Investors are speculating that the Reserve Bank of Australia will cut the cash rate to a new record low of 2.00 per cent in an announcement on Tuesday afternoon.

Rate cut expectations have boosted the major banks.

“I suspect there is a little bit of buy the rumour going on – the rumour of the rate cut,” OptionsXpress market analyst Ben Le Brun said.

“So we are a little susceptible at 2.30pm if we don’t happen to get one (another rate cut). There could be a little bit of downside.”

Among the major banks at 1200 AEDT, Commonwealth Bank was up 60 cents to $93.15, National Australia Bank was 36 cents higher at $38.68, ANZ climbed 31 cents to $36.01, and Westpac lifted 56.5 cents to $38.855.

In the resources sector, global miner BHP Billiton dropped 45 cents to $33.67 as crude oil prices fell and base metals had a mixed night.

Rio Tinto fell $1.03 to $64.57, and Fortescue Metals dipped three cents to $2.42.

Oil and gas producer Woodside Petroleum was down 29 cents at $35.01, and Santos lost 11 cents to $7.97.

Department store Myer edged up 1.25 cents to $1.6675 a day after the resignation of chief executive Bernie Brookes prompted the share price to plunge 10.78 per cent.

Jetpack developer Martin Aircraft was up 15 cents, or 8.57 per cent, to $1.90. The stock had soared to $3.15 before descending to a much lower level. The company has not made any announcements on Tuesday.

KEY FACTS

* At 1205 AEDT on Tuesday, the benchmark S&P/ASX200 index was up 11 points, or 0.18 per cent, at 5,969.9 points.

* The broader All Ordinaries index was up 9.2 points, or 0.16 per cent, at 5,935.5 points.

* The March share price index futures contract was 12 points higher at 5,952 points, with 10,861 contracts traded.

* National turnover was 644.3 million securities worth $1.78 billion.